City Comptroller Reaches Deals With 5 Companies on Giving Shareholders Say on Directors

Four months after embarking on a campaign to give shareholders the right to hire and fire board members at 75 companies, the New York City comptroller’s office has reached agreements with five of the companies.

In November, the office submitted proposals at 75 companies for “proxy access,” allowing shareholders who have owned at least 3 percent of stock at a company for three or more years to nominate directors for election to the board.

The office went after companies that lacked diversity on their boards, that had complaints of excessive executive compensation or that the office felt needed to do more to address climate change.

Aides in the comptroller’s office and shareholder rights’ advocates say the agreements appear to be setting off a domino effect that will help investors finally get the access to boards that they have been seeking for more than a decade.

“The landscape has shifted dramatically since November,” Scott M. Stringer, the comptroller, said on Tuesday. “Investors have galvanized around proxy access, and more and more companies are coming to the table.”

Mr. Stringer decided to take on company boards after a meeting last fall with Michael Garland, an assistant comptroller, and other aides who explained that they had taken incremental steps to reform company boards in the past. Mr. Stringer suggested a broader strategy for more impact, they said.

On Tuesday, the comptroller said, “When you have a piecemeal approach, powerful companies who are aligned will win every time.”

Beyond the five agreements, aides also pointed to decisions to institute proxy access at General Electric, Yum Brands and Citigroup — all of which were not among the 75 companies that received the office’s proposals — as proof that the city’s effort was having a far-reaching effect.

Ms. Yerger said that Mr. Stringer, as investment adviser for the city’s pension funds, gave the issue some heft. He oversees $160 billion in pension funds that have shares in 3,500 companies in the United States.

“It’s taken a leader like the comptroller to elevate the issue and move companies forward,” she said.

The shareholders’ rights movement took off more than a decade ago after scandals at companies such as Enron, and the Securities and Exchange Commission approved more shareholder access to boards.

But the United States Chamber of Commerce and the Business Roundtable, a group of chief executives from major companies, were successful in their legal challenges.

Though a few companies are now working with the comptroller’s office, many more are not.

She said that such access could also open the door to “the nomination of special interest directors with agendas favoring minority shareholder positions.”

“I do think that N.Y.C.’s efforts are quite bold, and I don’t agree that a single proxy access scheme fits all companies — or even 75 companies,” Ms. Stuckey said. “Each company has a unique shareholder base. Boards are charged with doing what is right for all of the shareholders.”

A version of this article appears in print on , on Page A22 of the New York edition with the headline: Stringer and 5 Companies Reach Deals on Boards. Order Reprints | Today’s Paper | Subscribe